Former Federal Reserve Chair Ben Bernanke expects the Fed could reduce its $4.5 trillion balance sheet by as much as half.
“I think they’re aiming for something in the vicinity of $2.3 to $2.8 trillion, something like that,” he said Monday on CNBC’s “Squawk Box.”
Bernanke did not expect the Fed would return its balance sheet to pre-crisis levels of less than $1 trillion.
During the financial crisis, the monetary-policy setting Federal Open Market Committee bought a massive amount of assets and cut short-term interest rates to near zero in an effort to stimulate the economy.
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